If an employee has a formal salary sacrifice arrangement via an Expense payment item (e.g., novated lease, health insurance, mortgage payments), the salary sacrifice amount is deducted from gross pay before child support is calculated.
Microkeeper automatically applies the Protected Earnings Amount (PEA) check to ensure the employee's take-home pay doesn't fall below the minimum set by Services Australia.
| Step | Details | Amount |
|---|---|---|
| Gross fortnightly pay | $2,400.00 | |
| Less salary sacrifice | Expense Item: Mortgage, car lease, health insurance, school fees | - $900.00 |
| Tax withheld | Example only | - $96.00 |
| Remaining pay | $1,404.00 | |
| PEA set aside | Current fortnightly PEA | - $1,068.46 |
| Available for child support | $335.54 | |
| Child support requested | $398.00 | |
| Amount deducted in Microkeeper | $335.54 | |
| Net pay to employee | $1,068.46 |
In this case, Microkeeper will only deduct $335.54, as deducting the full $398 would leave the employee below the PEA. The unpaid $62.46 will be collected directly by Services Australia from the employeeyour payroll does not need to do anything further unless a new notice is received.
Source: Adapted from Services Australia Notice to commence child support deductions